M&S store closure plans to hit fashion more than other categories
M&S’s new store closure plan will see the axe falling on still more shops that sell its clothing offer with the company’s focus on food becoming even more marked.
But that doesn't mean it's throwing in the towel on fashion and it’s accelerating its e-commerce investment. It expects a much bigger chunk of fashion sales to come through its online operations in future.
But what about those closures? The company expects to shut 30 full-line (that is, stores that sell its complete offer) branches in a fairly aggressive closure programme that comes on top of a succession of store closures already enacted.
Its top executives said that it's seeing the green shoots of its transformation strategy, but more work is clearly needed to future-proof the business. And in a post-pandemic world where physical stores may now be open but consumers are still expected to shop ever more heavily online, that means not all branches have a future.
Speculation is now rife in towns and suburbs across the UK as locations that have already lost big-name stores such as Debenhams and Topshop are worried that even more gaps will appear if M&S closes as well.
After the closures, M&S will have a chain of only 180 stores that offer its clothing and homewares ranges. That's down from 254 at present, because although only 30 shops are actually closing, others that sell clothing and homewares today will convert to food only. There will also be a number of relocations.
And in a further sign of the trend that sees retail sites being converted to new uses, some of the shuttered shops will be converted to homes or other functions. This will generate at least £200 million for M&S to invest in new and expanded stores elsewhere and in covering the costs of the closures.
As that suggests, it's not all about a contraction on the fashion front. As well as the expected expansion in fashion sales online, the company is opening around 17 new or expanded full-line stores in the next two years. At least six of these will be former Debenhams sites, which means they will be large branches.
CEO Steve Rowe has a target of online sales making up around 40% of the company’s clothing and home business in the future, compared to 20% before the pandemic, so the closures are perhaps understandable. This echoes a similar situation at John Lewis where the company's success in building its webstore meant that some of its department store branches became unviable.
M&S has said that a number of its existing stores are in long-term decline and it can’t justify investing more money in them.
Not that the closures will necessarily come quickly. Around 30 will shut over the next decade.
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